In much of what was once called “the free world,”
governments and economies are in the throes of self-destruction. Before long,
we shall witness revolution in several of these countries.
The revolutions may prove to be violent, or they
may prove to be “soft” revolutions – major changes in the political
structure. They may vary anywhere from mere changes in the rhetoric of
political hopefuls, to changes in the actual structure of governments.
One incorrect assumption about revolution is that
it took place because the entire population had become dissatisfied. Not so.
Most every revolution occurs as a result of a fraction of the
population (sometimes a tenth, sometimes a third or more) taking action
significant enough to bring about the desired changes.
This is an important point, as it serves as a
reminder that revolution frequently comes about as the result of a minority
dissatisfaction. The revolution may then succeed if the minority can pull off
a coup. And revolutions are not necessarily morally right or wrong, they’re
just successful bids for change. In many such cases, all that changes is the
faces, not the fundamentals of governance.
But, assuming that the objectives are clearly-stated
objectives (as opposed to vague proclamations such as, “We’re not gonna take
it anymore,” we can examine, whether, in hindsight, the stated objectives of
the revolution have been realised.
The Ghost of Revolution Past
Let’s have a brief look at the American and French
Revolutions, which occurred at roughly the same time. Each aimed at the
overthrow of a monarchy that was regarded as oppressive in its rule. The
American Revolution was highly successful in that, by championing the rights
of the individual , it opened up America to a highly productive future
that lasted for quite some time. However, the French Revolution, which had
similar stated objectives (the motto was, “Liberty, Equality,
Fraternity”), did not succeed in its stated objectives. It devolved fairly
quickly into vengefulness, pillaging of the property of the Second Estate
(the nobility) and demands for entitlements and political favours.
Consequently, it failed to revitalise France; it did not result in an era of
great freedom and productivity; it devolved into corruption and socialism.
A glimpse into why greater productivity (as a
bi-product of greater individual freedom) did not occur is evident in
France’s “Declaration of the Rights of Man,” a parallel document to the
then-new American “Bill of Rights.” The clauses were somewhat similar, but,
on inspection, the eventual abuse of rights was baked in the cake right from
the outset. Two examples:
XIII. A common contribution being necessary for
the support of the public force, and for defraying the other expenses of
government, it ought to be divided equally among the members of the
community, according to their abilities.
Here we have a clause that was clearly written by
a committee. The original author could have been a French “Jefferson” or
“Madison,” as it states that taxation should be divided equally, yet
an amendment was added - “according to their abilities.” Well,
unfortunately, that tosses “equal” out the window, and allows for future
legislators to add as many socialistic regulations as they see fit. “Equal”
has a clear meaning, whilst “according to their abilities” is vague enough to
allow any level of inequality future legislators might desire. Clearly, in
putting this clause through committee, there were French “founding fathers”
who had no intention of honouring liberty and equality, but had a more
entitlement-centred France in mind.
XVIII. The right to property being inviolable
and sacred, no one ought to be deprived of it, except in cases of evident
public necessity.
Here we go, again. A firm statement as to the
rights of the individual, watered down (again, presumably in committee) with
the rider, “except in cases of evident public necessity,” to allow the state
the authority to violate that right as it sees fit.
A declaration of rights that negates itself is no
declaration of rights at all. Noted English pamphleteer Thomas Paine (who had
assisted in providing verbal focus to the American Revolution), said, in
discussing the French declaration at the time,
“[G]overnment is governed by no principle
whatever…it can make evil good and good evil, just as it pleases. In
short,…government is arbitrary power.
Exactly so…and a memorable observation with regard
to any government.
The Ghost of Revolution Present
Argentina was once a thriving country, but has
been plagued, since the Perons in the 1940’s, with socialistic regimes. They
have just elected a new president - Mauricio Macri, who has promised to save
the collapsing economy through conservative measures. To most people outside
Argentina, this appears to be a soft revolution; a promise for a revitalised
Argentina. However, for those closer to the situation, the “revolution” may
be pre-ordained to failure. Across the river in Uruguay, prior to the recent
election, my neighbour Marcelo shrugged his shoulders and said to me,
“Most Argentines receive entitlements, but as
Cristina ruins the economy further, the entitlements get smaller and smaller.
So, they’re angry and, this time, they’ll vote for a conservative for
president this time. Argentina will become more fiscally responsible for two
or three years, then the people will demand a return to the socialism that
they had before. The majority don’t care about a healthy economy. They only
want conservatism long enough to stabilise the country, so that they can get
their entitlements back. It’s always the same.”
He’s correct that in Argentina, the cycle has
repeated over and over. Until now, no lesson was learned by the majority of
voters. So, this time around, have they figured out that entitlements are
counter-productive to a vibrant economy and begin a period of prosperity for
Argentina, or will they give the new president a few years to stabilize the
economy, then once again begin demands for entitlements? Time will tell.
The Ghost of Revolution Future
Many in the US talk of revolution. Most hope for a
soft revolution, in which their country would go back to the good old days of
traditional values, hard work, the rights of the individual and a productive
society.
Not likely to happen, I’m afraid. The first
American revolution resulted in that very outcome, but that was (in my
opinion) because the colonists had no entitlement society to begin with. They
went to America as pioneers and each was his own champion. They therefore
accepted hard work, self-reliance and treasured individual rights. After the
revolution, the US went into a long, highly productive period, because the
great majority of Americans shared this view.
Unfortunately, that’s no longer true in America.
“Freedom” is a concept that sounds good to all, but, with it come great
responsibilities – responsibilities that a majority of citizens are unlikely
to accept after the revolution. Just as in France, they will want to be
assured that, although they want their own freedom, they want to limit
the freedom of others; so that others be forced to contribute to
“the greater good.”
Once the concept that your neighbour is
obligated to sacrifice his freedom to satisfy your needs or desires is
ingrained in a people, it’s virtually impossible to remove. If we seek true
change, we’re only likely to find it in locations that are truly
starting over, without the baggage of an entitled population to mire the
rebirth of the new regime.
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Jeff Thomas is British and resides in the Caribbean. The son of an
economist and historian, he learned early to be distrustful of governments
as a general principle. Although he spent his career creating and
developing businesses, for eight years, he penned a weekly newspaper column
on the theme of limiting government. He began his study of economics around
1990, learning initially from Sir John Templeton, then Harry Schulz and
Doug Casey and later others of an Austrian persuasion. He is now a regular
feature writer for Casey Research’s International Man and Strategic Wealth
Preservation in the Cayman Islands.
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The author is not affiliated with, endorsed or sponsored by Sprott Money
Ltd. The views and opinions expressed in this material are those of the
author or guest speaker, are subject to change and may not necessarily
reflect the opinions of Sprott Money Ltd. Sprott Money does not guarantee the
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